Hoping to file your 2024 taxes early? You might have trouble online

(THE CANADIAN PRESS/Sean Kilpatrick)

If you’re someone who likes filing your taxes early, you could run into trouble this year.

While the Canada Revenue Agency has been accepting online tax returns since Feb. 24, many eager filers have found themselves unable to click the “submit” button.

The issue affects anyone reporting capital gains or losses on their 2024 return, regardless of which online service they use to file.

“At this time, returns that include capital gains or losses cannot be filed with the CRA,” reads a message for Wealthsimple users. “We will remove this notice once the ability to file returns with these forms becomes available.”

What’s the problem?

The issue stems from the federal government’s last-minute decision to delay a planned hike to the capital gains inclusion rate.

That rate determines what portion of a person’s capital gains – such as the profits earned selling stocks – is subject to tax.

The increase was supposed to take effect last summer, bringing the inclusion rate for capital gains above $250,000 to two-thirds, up from one-half, but the Department of Finance recently decided to defer the change until 2026.

With that announcement being made at the end of January, just weeks before tax season, the CRA was left scrambling to update its systems.

“Our team’s in full force trying to revert some of the forms to what they were before,” said Charles Drouin, CRA spokesperson. “That is not as easy as flipping a switch, it takes more than a few weeks, so they’re still working on it now.”

And while very few Canadians can boast capital gains above $250,000 – for now, the issue prevents anyone with any amount of capital gains or losses from filing their taxes.

When is the fix coming?

The Canada Revenue Agency previously warned the system updates required to process capital gains “may not be completed” by the time online filing opened on Feb. 24, but there have been no updates since.

Drouin told CTV News the CRA is currently targeting mid-March, but that it could take longer.

“We’re pretty confident it will be fixed within a week or two,” he said. “But to be safe, I tell people to wait until the end of March. Don’t rush.”

For taxpayers impacted by the delay, the CRA has promised relief from late-filing penalties and interest until June 2 for individual filers and May 1 for trust filers.